By Andria Cheng

Almost $1 billion in losses and $4.3 billion in lost sales last year significantly sapped Penney’s cash flow and led to the ousting of Chief Executive Ron Johnson earlier this month.

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Mike Ullman

But in the past week, the struggling retailer has gotten a few bits of good news. On Monday, the company confirmed a $1.75 billion, five-year loan commitment from Goldman Sachs to shore up its liquidity after it recently also tapped $850 million from its credit line.

Penney shares rose 2.6% to $17.44 in early trading on Monday with already 5.8 million shares changing hands. Through Friday, its shares have surged 22% since April 9, the day after Penney returned Mike Ullman to his post as CEO.

On Monday, Sosnick reiterated Penney appears to be “at an inflection point, moving from danger to a more secure foundation.” He said a rally to $20 to $25 is likely.

Goldman’s “cash infusion will stabilize JCP and put it on a path toward recovery,” Sosnick said in a report on Monday, adding the money will allow the company to repay its $850 million credit line borrowing and provide funds to buy inventory and improve its online sales. “Attaining financial stability without equity dilution is a big positive. We anticipated that Ullman would immediately correct JCP financial imbalance. He has done so.”

The analyst said that while the additional loan interest costs will add a burden to Penney — which already has an expense ratio of 34.5% — it’s an “acceptable price” to pay. He said Ullman has spoken to store managers, boosting their morale, whereas he said Johnson didn’t seek their input. Ullman also has spoken to vendors and has brought back company veterans to rebuild a “depleted” headquarters organization.

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About Behind the Storefront

Behind the Storefront is a blog about all things retail. It’s aimed at investors, shoppers and anyone else with a passion for learning about what drives consumer behavior. Hosted by Andria Cheng, Behind the Storefront will cover the business, brands and shopping behavior that’s behind some of the biggest companies, and largest employers, in the world. You can reach Andria at Acheng@marketwatch.com.